Satyam Computer Services Ltd's search for a buyer has suffered a setback, as a source said IBM is not in the bidding, while the Spice Group remains undecided about its participation.
Satyam is looking for a buyer to help restore confidence among its investors and customers, after the business software company's founder admitted to accounting fraud in India's biggest corporate scandal.
International Business Machines Corp was believed to be among about eight bidders shortlisted by Satyam's government-appointed board according to unconfirmed newspaper reports. But a source with knowledge of the situation, who was not authorized to speak publicly, told Reuters IBM was not in the bidding.
Potential buyers may be wary about the likelihood of customer losses as well as a lack of clarity on Satyam's true value due to the years of accounting fraud. Analysts say any new buyer may likely face legal liabilities from Satyam shareholders.
Meanwhile, B K Modi-promoted Spice Corp has said it is withdrawing from bidding "for the moment" for Satyam Computer alleging non-transparency, multiple short- listing process and lack of clarity in the selection criteria.
A senior company official said, "It is withdrawing for the moment from the race after the Satyam Board told Spice Corp that it is following the best possible transparency in the process as laid down by SEBI and CLB."
"We have no option but to withdraw from the process at the moment as we feel the Satyam Board is not following an open auction, not sharing the name of bidders and going for multiple rounds of technical short-listing process, which are not suggestions by CLB and SEBI," the official said.
"The withdrawal is for the moment as we have written a letter to Justice S P Bharucha who is overseeing the bidding process, asking for more transparency in the bidding process.
With agency inputs